MicroStrategy Incorporated Variable Rate Series A Perpetual Stretch Preferred Stock

MicroStrategy Incorporated’s Variable Rate Series A Perpetual Stretch Preferred Stock is a perpetual preferred equity security designed to provide income-focused investors with regular, cumulative monthly dividend payments. The security carries a stated amount and initial liquidation preference of $100 per share, with dividends initially set at a 9% annual rate. Uniquely, the MicroStrategy board has the authority to adjust this variable dividend rate each month, aiming to keep the trading price of the preferred stock near its $100 stated value, subject to certain constraints to protect holders. The dividend is paid only when and if declared, and it accumulates if unpaid, reflecting the cumulative nature of the instrument. This preferred stock holds limited voting rights and is subordinate to company debt but ranks senior to common equity in liquidation. It is part of MicroStrategy’s strategy to extend access to a broader investor base seeking steady income, especially in the context of the firm’s role as a prominent Bitcoin Treasury Company. Proceeds from these securities are used for corporate purposes, including the acquisition of bitcoin and general working capital, integrating digital asset exposure and fixed-income characteristics within the technology and digital asset markets.